There are a few key differences and similarities between Arrived rental property investments and public REITs focused on rental homes.
Key Differences:
Ability to Select Individual Properties and Investment Strategies: Arrived provides investors with the option to choose specific properties, while public REITs spread investments across a large pool of assets.
Volatility : Public REIT values are traded daily on the public markets and can often have large price fluctuations, that are often caused by external macro economic factors like interest rates. Those fluctuations occur even if the underlying properties have not changed in value. Arrived properties
Yields: Arrived can also offer higher dividend yields compared to public REITs, but requires holding shares for the full investment period.
Liquidity: Because Public REITs are traded on the open market, they offer instant liquidity to investors, while Arrived offers more limited liquidity opportunities.
Similarities: Notably, each long-term rental property on Arrived is taxed as a REIT. This means that when you invest in an Arrived single family residential properties, you’re getting the same tax benefits that public REITs are able to pass on to their investors. This includes offering passthrough taxation, depreciation tax deductions, and the Qualified Business Income deduction. Additionally both Arrived and public REITS are regulated by the SEC, protecting investors while allowing them to profit from real estate without direct management.
For more details on the similarities and differences, check out this blog post.
Disclaimer
The opinions expressed in this article are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product. The views reflected in the commentary are subject to change at any time without notice. View Arrived’s disclaimers.